Analysis - Smallholder agricultural enterprises in Africa face a lot of challenges getting loans from financial institutions like banks due to the stringent requirements they can hardly fulfil. Investor confidence is usually lacking, given the risks involved in this sector of the economy.
Nairobi — Smallholder agricultural enterprises in Africa face a lot of challenges getting loans from financial institutions like banks due to the stringent requirements they can hardly fulfil. Investor confidence is usually lacking, given the risks involved in this sector of the economy.
Users of these technologies are in 35 most climate vulnerable countries, according to Scott Onder, the chief investment officer at Mercy Corp. In Kenya, for example, the NGO has partnered with Safaricom, the largest mobile network operator in the country through its DigiFarm product. "We chose to work with Root Capital because their interest rates are below what you would normally get from the financial market, plus their terms are very accommodative to a start-up like ours," says James Gichanga the co-founder of Batian Nuts Ltd.
In other words, the buyer of farm produce based in the US, Europe or Asia and the borrower - or Batian Nuts Ltd in this case - signs an agreement with Root Capital. And when the time comes for payment, the buyer pays Root Capital directly. In addition, they provide small and medium sized agricultural enterprises with technical assistance through a programme known as"agronomic and climate reliance advisory."
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